The Philippines Savings Bank, otherwise known as PSBank, will eliminate the use of magnetic strip-based cards, fully implementing EMV cards on September 1, according to a report by Rappler.com.
Countrywide EMV implementation on the horizon
Bangko Sentral ng Pilipinas, or the Central Bank of the Philippines, is the country's primary banking organization and responsible for maintaining price stability and supervising the nation's financial institutions, among other duties. In 2014, the organization released a set of guidelines regarding the implementation of EMV. It noted the fulfillment was necessary to provide security and fraud-free banking options to citizens. The BSP mandated all the country's banks to equip their customers with EMV card until a final deadline of June 30, 2018.
According to GMA News Online, the banks will also be responsible for reimbursing customers for any funds lost due to fraud during that time. At a December 2016 press conference, Nestor Espenilla Jr., the BSP's deputy governor, said the Philippines lost hundreds of millions of pesos to fraudsters in 2015 through card skimming. The losses occurred even though under half of the country's 76 million cards in circulation used magnetic strips at the time.
"We will engage each and every one of our banks, so we will agree with a full-compliance timetable that is acceptable to the BSP," Espenilla said at the conference. "The main reason we got the industry to move in this direction is primarily to deal with the large number of card frauds that are being observed in the country."
PSBank's upcoming EMV switch was issued to work in accordance with the Central Bank's mandate.
According to BusinessInquirer.net, a bank supervised by the BSP that fails to comply with the EMV mandate will face monetary sanctions. Financial losses via fraud would have to be estimated by companies that neglect to implement the technology accordingly.
The United States ranked last in using EMV for card transactions last year, with under 19 percent of all call card transactions having involved the technology. Asia, who is one position ahead of the U.S. in the global standings, had 55 percent of card transactions occur with EMV, according to a report by EMVco.
While the United States saw the least amount of EMV purchasing activity, it did see a 17 percent increase in EMV transactions between 2015 and 2016.
The number of U.S. customers adopting EMV enabled cards has been rising each year, but until full adoption is reached, there still exists the possibility for fraud and subsequent financial losses to occur. An initiative like the PSBank's mandatory EMV card transition is a potential option American institutions can use to improve customer security.